As of today, August 4, 2025, shares of India’s ITC Ltd rose modestly after flat net profit in Q1 FY26—while revenue surged 20%, margin pressures persist amid rising input costs and strong FMCG and cigarette volume growth.
Shares of ITC Ltd traded higher today after the company reported mixed financials for the quarter ended June 30, 2025 (Q1 FY26). Despite flat net profit at ₹4,912 crore (compared to ₹4,917 crore in Q1 FY25), revenue climbed 20% year‑on‑year to ₹21,059 crore, driven by strong performances across cigarettes, agri‑business, and FMCG divisions.
The cigarette business saw an 8% revenue uptick, supported by stable taxation and curated intervention. Yet margin pressures persist due to elevated leaf tobacco costs—a trend expected to continue through FY26.
The FMCG segment displayed resilient growth, though margin gains remained cautious. The paperboard business continued to experience cost pressures and weaker demand dynamics.
ITC highlighted that macroeconomic tailwinds—including easing inflation, anticipated interest-rate cuts, and pre-emptive government spending—could enhance financial momentum in future quarters.
At 9:25 a.m. IST today, ITC shares were trading at ₹419.15 on the NSE, marking a 0.65% gain.
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Expert Commentary and Financial Outlook
Analysts remain upbeat despite flat profitability. Observers note that cigarette EBIT margins—though compressed—were offset by a multi-quarter high in volume growth. With declining commodity prices and potential improvements in tax regime, earnings growth is expected to accelerate in H2 FY26.
While risks from tobacco tax revisions (related to replacing the compensation cess) remain, the company’s diversified portfolio and strategic investments across verticals—spanning premium FMCG offerings and export-driven agri operations—continue to underpin institutional confidence.
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